Evaluating Foreign-Market Environments for International Franchising Expansion

Abstract

The purpose of this study is to investigate the influence of environmental factors on international franchising, and to offer a normative model to evaluate the international franchising environment. Using correlation analysis, this study finds that environmental factors including economic, demographic, cultural and political factors are related to and may influence the decision of franchisers to expand their operations in a host country. The study suggests that franchising practitioners conduct an environmental analysis of the foreign market that, at minimum, will integrate the variables discussed in this paper.

Market Conditions Favoring Master International Franchising

“…Entrepreneurial cultures are often associated with high levels of individualism and masculinity. As such, Alon, Toncar, and McKee (2000) suggested that particularly high levels in masculinity and individualism are preferable franchising country-related factors. A direct test of Hofstede's scale reveals a positive correlation between the dual factors of individualism and masculinity on the total level of international franchising (Toncar, Alon, & McKee, 2000).…”

“…As such, Alon, Toncar, and McKee (2000) suggested that particularly high levels in masculinity and individualism are preferable franchising country-related factors. A direct test of Hofstede's scale reveals a positive correlation between the dual factors of individualism and masculinity on the total level of international franchising (Toncar, Alon, & McKee, 2000). Russia, for example, with a relatively high level of collectivism and low level of masculinity, is culturally unattractive to franchising as compared to the United States (Anttonen, Tuunanen, & Alon, 2005).…”

Brand‐country of origin (COO) knowledge and COO image: investigation in an emerging franchise market

“…International franchising is fast becoming the focus of investigation (Alon et al, 2000;Welsh and Alon, 2001). Franchising is one of the fastest growing US exports (Paswan et al, 2001a;Zeidman, 2000).…”

Internacionalização das redes de franquias brasileiras: uma análise organizacional e institucional

“…Os aspectos referentes aos fatores socioculturais são determinantes para a compreensão dos valores e normas culturais locais, afetando a aceitação por marcas estrangeiras e determinando padrões de negociação, não obstante ser um indicador capaz de sinalizar a estrutura social de um país no que diz respeito ao nível de educação formal, saúde e renda (ALIOUCHE & SCHLENTRICH, 2011;ALON & SHOHAM, 2010;ALIOUCHE & SCHLENTRICH, 2009;CUERVO-CAZURRA, 2008;ALON & MCKEE, 1999;ALON et al, 2000).…”

“…• Fatores socioculturais: caracterizar a estrutura sociocultural dos países de destino mediante os seguintes indicadores: (i) índice de desenvolvimento humano e (ii) padrões culturais e sociais em comum (ALIOUCHE & SCHLENTRICH, 2009;ALIOUCHE & SCHLENTRICH, 2011;ALON & SHOHAM, 2010;ALON & MCKEE, 1999a;ALON et al, 2000).…”